Here are a few tips for how to deal with multiple offers when selling.
Dealing with multiple offers differs based on whether you’re on the buying or selling side. On the selling side, the complaints include things like putting homes on the market and having the bid deadlines due the next day. After all, listings often get their first offers on just the first day of being available. If you share that complaint, you’re letting the buyer drive the train in a seller’s market. Why would you do that? As a listing agent, your job is to maximize your client’s return.
Here’s what I think that every agent should be doing: Comply with the MLS rules that say your home can’t sit on the market for more than 72 hours without any showings. We list all our homes on Wednesday and don’t hold any showings until Saturday. That creates pent-up demand. Depending on the price point, we’re running 15 to 20 showings on Saturday and another 10 on Sunday. We then set the offer deadline to Monday at noon.
This way, we give everyone the fairest opportunity to see the listing and make an offer on it, especially those who work during the week and wouldn’t otherwise be able to schedule a showing. This strategy is producing stellar results for our clients; on one listing, we sold it for $70,000 over asking price, and it was a cash offer with no inspections.
However, what you should NOT do is simply put the home on the market and take the first offer that comes along. You’re not maximizing your seller’s return. There’s an arrogance in real estate that causes people to think that a certain home can’t possibly be worth what’s being asked for it. I’ve been an appraiser for 30 years, and here’s the deal: As Realtors, we set the price; when buyers have looked at every alternative with prices going up 15% to 20% in a low inventory market, that is what sets the value of the home.
One client of mine in Boston bought a home for around $100,000 over list price. Many people thought he was an idiot to do so, but he’s not. Building that same house would have cost $150,000 more than what he paid. He saved a small fortune! The agent had underpriced the home dramatically by not looking at what was currently on the market.
On the buying side, what can you do to get your offers accepted? I recently had seven offers on one home. One offer had a VA loan with $6,000 in concessions; that agent was wasting their time. If they had called me beforehand, I would have told them not to write an offer when they were competing with cash offers that had no inspections.
That’s why it’s so important for buyer’s agents to communicate with listing agents; you can get information about what’s important to the seller in terms of price and conditions, which allows you to bolster your offer. Also, be advised that we’re no longer taking escalation clauses—another thing some agents fail to find out before submitting offers because they don’t communicate with the listing side.
If you have any questions about dealing with multiple offers from either the buying or selling side, don’t hesitate to reach out to me. I’d love to help you.